Legal Services Bill prepares for Royal Assent

The Bill completed the penultimate hurdle before its official enactment yesterday (29 October) and will receive Royal Assent next week.

The news brings to an end the tussle between the House of Commons and the House of Lords over the detail of the Bill, which was first introduced to the Lords last November.

The final version of the Bill includes changes to several key elements, including requiring the Lord Chancellor to consult with the Lord Chief Justice over the make-up of the Legal Services Board (LSB).

The need for consultation will be welcomed by commercial lawyers. Earlier this year, all five of the magic circle firms' senior partners, together with Bar Council chairman Geoffrey Vos, criticised Whitehall for the perceived lack of independence in the composition of the LSB. They said the Government risked undermining international confidence in the UK legal services market.

The LSB will act as an overarching regulator for both the Solicitors Regulation Authority and the Bar Standards Board with the ability to strip underperforming professional bodies of their powers.

The new-look Bill has also clarified that lawyers cannot be penalised for poor performance by both existing regulators and the inaugural Office for Legal Complaints.

The new legislation, most of which is likely to come into effect in 2011 or 2012, will give law firms a green light to form practices with other professionals, such as barristers and accountants, as well as attracting external investment or listing on the stock exchange.

Many top UK firms have already discussed funding tactics with a variety of investment houses, with names such as Cazenove, Catalyst, Fleming Family & Partners and Noble touted as roadshowing to firms. Proposals have moved beyond floating a law firm with investors keen for longer-term investment opportunities.

Over the next six months, professional services association the Managing Partners' Forum and specialist consultant Brand Finance will assign a brand value to many of the world's top firms in preparation for the changes.